Wealth transfer can happen in many ways. The most inefficient and unfortunately, most common way, is transferring assets at death. When you have assets to provide enough income during your retirement years, you can start this transfer earlier. You get to see your children and grandchildren enjoy these assets, making their lives a little easier.
Helping set up a registered education savings plans is a great way to transfer wealth to your children and grandchildren. This product allows for tax-sheltered growth, government grants (Canada Education Savings Grant), and multiple investment options. Grandparents can gift funds directly to children who would then set up the account. Another option would be for the grandparents to set up the account with the grandchildren as the beneficiaries. This will allow the grandparents to keep control of the funds. The funds are then used to help pay for the beneficiaries’ post-secondary education.
Insurance products are another way to transfer wealth to other generations. Grandparents can help set up a life insurance policy or critical illness policy. They will pay the insurance premiums to start and will eventually transfer ownership to their children or grandchildren. Additional contributions can be made to the policy to help cover premium payments in the future.
If you have questions regarding transferring wealth to family members, please contact the PlanWright office at 780-842-1370.
